The DWP’s muddled maths is sending universal credit deeper into meltdown

Last month, a seriously ill father-of-two told me he was living ‘hand to mouth’ because the DWP was withdrawing more than £90 from his allowance each month

“I am delighted to announce the introduction of the universal credit,” said Iain Duncan Smith at the Conservative Party conference on 5 October 2010. “[It] will, I believe, restore fairness and simplicity to a complex, outdated and wildly expensive benefits system. A real time system which will also help cut the cost of fraud and error.”

It may come as a surprise, then, that nine years on, the government’s spending watchdog has revealed that fraud and error in the welfare bill are at their highest levels since 2006 – with much of the rise down to the introduction of universal credit.

To go into the numbers, the National Audit Office (NAO) revealed on Thursday that benefit claimants and pensioners lost out on £2bn that they were entitled last year to because officials short-changed them. Another £1.1bn was overpaid to claimants because they failed to give the right details about their income – through the complex online portal system – on time.

What appears on the surface like a fairly bland report, filled with numbers and percentages, sheds light on the scale of devastation being inflicted on people across the country. Families are being denied the support they rely on to live on because of careless errors. People are finding their monthly allowance fluctuating from a liveable amount to near to nothing, with no prior notice, as the government tries to claw previous overpayments back.

And the real stories are out there. Last month, a seriously ill father-of-two told me he was living “hand to mouth” because the Department for Work and Pensions (DWP) was withdrawing more than £90 from his allowance each month – half of which was deducted for previous debts and historic overpayments.

Martin Weaver, who suffers from kidney disease and heart disease, is currently surviving on beans on toast and relying on charities for basic things like a sofa and a washing machine. During the winter months, he was forced to move into an old caravan with just a small electric heater.

In another case, a mentally unwell universal credit claimant received less than £6 for the month after hundreds of pounds was withdrawn from their allowance. A letter from the DWP stated that £312 had been taken off their monthly benefit allowance, leaving them with just £5.82. I was unable to see a breakdown of why the money had been deducted, but some form of historic overpayment is likely to have been on there.

A key feature of the sweeping reform was that payments would taper off as the recipient moved into work, not suddenly stop, thus avoiding a “cliff edge” that was said to “trap” people in unemployment. If jumping from £312 one month to £5.32 the next isn’t a cliff edge, I don’t know what is.

Also at play here is the DWP’s often arbitrarily punitive sanctions regime, which penalises benefit claimants who miss job centre appointments – with often little consideration of the many variables in people’s lives. Charities have told of cases where parents have had hundreds docked after having to miss meetings with job coaches due to childcare issues.

If universal credit was designed to help people manage their own finances and make the benefits system simpler, why are we are seeing vulnerable individuals and families being swung from pillar to post, more at the mercy of the state than ever?

Nearly a decade on from Duncan Smith’s announcement of his sweeping welfare reforms, it is time to accept that they are not delivering. When the data shows that a reform designed to “simplify” the system has caused a surge in the error rate – not to mention pushing people even deeper into hardship – surely something has to give.